LAS VEGAS, NV – A panel discussion about piracy at the Consumer Electronic Show on Tuesday may represent music to some content producers’ ears: internet service providers may be ready to start filtering traffic for copyright infringement.“We’ve got to figure out a friendly way to do it; there’s no doubt about it,” James Cicconi, senior vice president for external and legal affairs at AT&T, told a New York Times reporter.

Representatives from AT&T, NBC, Microsoft and several digital filtering companies were among the experts on the panel.

“What we are already doing to address piracy hasn’t been working. There’s no secret there,” Cicconi told the audience.

For the past six months, AT&T has been conferring with technology companies about implementing digital fingerprinting techniques at the network level, Cicconi said. His company and others are interested in installing network “sniffers” to check transmitted packets for infringing material.

“We are very interested in a technology based solution, and we think a network-based solution is the optimal way to approach this,” he said.

Internet watchdogs have decried network filtering as a means to safeguard copyrights and other user rights because of the potential for abuse of the systems. They say it’s analogous to Big Brother’s thought police, and packet sniffing could prevent the legitimate “fair use” of some material. However, filtering for pirated material and obscenity already occurs on sites like YouTube and some university networks.

NBC Universal General Counsel Rick Cotton, who leads the studio’s fight against piracy, said those issues would have to be addressed by the ISPs as a group before any methodology was adopted.

“The volume of peer-to-peer traffic online, dominated by copyrighted materials, is overwhelming. That clearly should not be an acceptable, continuing status,” he said. “The question is how we collectively collaborate to address this.”

Cicconi told the New York Times, “Whatever we do has to pass muster with consumers and with policy standards. There is going to be a spotlight on it.”

Comcast got a taste of the spotlight last year when it faced a major scuffle with its customers after it reportedly began clamping down on those who used extraordinary amounts of bandwidth. The company’s rationale was that customers who used that much bandwidth had to be trading files on the P2P networks. The Federal Communications Commission now is probing Comcast’s behavior.